Drilling in the Arctic National Wildlife Refuge:
The Legal and Environmental Issues It Will Raise

Drilling in the Arctic National Wildlife Refuge (ANWR) has been contemplated for some time. With today's record high prices, the pressures to drill have never been higher. In the November election, the pro-drilling constituency picked up, by some estimates, four votes. If that is true, then drilling is likely, for Congress has the votes to repeal the twenty-five-year-old ban on drilling in ANWR, and allow the prospecting to begin.

The road from the enactment of the law to actual production of oil and gas will be long and twisty, however. Federal law protects wilderness, wildlife habitat, and air and water quality. And ANWR drilling will have to comply with all the relevant laws and regulations - which I will describe in this column.

How ANWR Drilling Will Be Pushed Through Congress

Because the federal government expects to reap some revenue from ANWR oil/gas leases, the measure will probably be tucked into an omnibus spending bill. Such a bill, under Senate rules, is immune from filibuster - and thus ought to sail through both houses with the Democrats' minority unable to block its passage.

In fact, though, it's unlikely ANWR will produce very much net benefit for the government. Even under the rosiest of projections - and projections vary widely, due to the nature of prospecting without exploratory wells - the amount of oil and natural gas on the table is minor compared to present U.S. demand.

USGS estimates of "in place" resources range from 4.8 billion barrels to 29.4 billion barrels. "Recoverable," profitable deposit estimates range from 600 million to 9.2 billion barrels. By comparison, the present US demand is at about 8 billion barrels per year and rising. Thus, ANWR might merely meet a single year's U.S. demand (and there's even a chance it won't be that much). ANWR is, after all, surrounded by oil and gas fields that have been producing throughout the circumpolar north (Canadian, Russian, and American), some for almost thirty years.

The real profit here will accrue to private companies and the State of Alaska - which, under U.S. law, already receives enough of the leasing revenue from oil and gas to do without a state income tax. Certain Inupiat tribes still making a subsistence Arctic living there may benefit as well, assuming their profit-sharing deals for the extraction projects are sufficiently advantageous to them.

Thus, while it is dubious whether the people of the U.S. benefit much, it is certain that the environment will pay a price. It's entirely appropriate, then, that would-be drillers will first have to run the gamut of environmental laws before they begin.

ANWR: Its Creation by Interior Department Order, and Protection by Statute

Like other American wildlife refuges, ANWR is governed by a dense network of statutes and regulations, and administered by the U.S. Fish & Wildlife Service (FWS). Some of these refuges are managed solely for wildlife; some are under multiple-use mandates. ANWR has always been an exception within this system, though, for two reasons.

The first reason ANWR is exceptional is its awesome scale: It covers over 19 million acres. The ANWR and its neighbor to the south, the Yukon Delta NWR, are by far the largest in the system of wildlife refuges. (The largest in the contiguous United States, incidentally, is Nevada's Desert NWR, at 1.5 million acres).

The second reason the ANWR is exceptional is that it was "withdrawn" from mining, logging, and other exploitative uses under the general public lands laws as early as 1960--just after Alaska's statehood. By order of the Eisenhower Interior Department, a giant reserve was withheld from future exploitation.

From the perspective of environmentalists, the Interior Department order came just in time. Only a few years later Prudhoe Bay (ANWR's neighbor to the north and west) was leased, and the Trans-Alaska pipeline was built.

In 1980, in the Alaska National Interest Lands Conservation Act (ANILCA), Congress further addressed the legal status of the ANWR, among other Alaskan land issues. Specifically, it enshrined the reserve, plus another 9.2 million acres, as the Arctic National Wildlife Refuge we know today. (A few snags were left, though, because even then controversy brewed over the exploitability of the region's vast hydrocarbon deposits.)

Congress designated most of ANWR as federally protected "wilderness." That designation -- applied to government-owned land like the ANWR--triggers a panoply of protections under the 1964 Wilderness Act.

Most of ANWR remains under this protective blanket today. But, as I will explain, not all of the land comes within the "wilderness" designation.

The ANWR Area Exempt From "Wilderness" Protections

Excluded from the "wilderness" designation under ANILCA Section 1002 was a comparatively small coastal plain area, thought to be especially rich in oil and gas deposits. The area is sandwiched between the Brooks Range and the Beaufort Sea.

Although the area did not enjoy the "wilderness" label, a battle still raged about whether drilling ought to be banned there. Congress almost repealed the ban in 1995, but President Clinton vetoed the bill. Meanwhile, the Department of Interior was studying the potential effects of drilling in the area according to the requirements of the National Environmental Policy Act (NEPA).

Finally, in 1987, the Reagan Interior Department completed the required environmental impact statement. Much to the chagrin of drilling interests, it projected that the impacts of oil and gas development on the coastal plain would be significant.

Why? In brief, because the rich species assemblage of the coastal plain is intimately tied to its unique arctic wetlands complex. The precise area at issue, for instance, is home to protected populations of caribou, wolves, grizzly bears, polar bears, and migratory birds. At least three species of these birds, moreover, are listed as "endangered" and thus protected under the Endangered Species Act.

Endangered or not, all of these populations rely on the area's truly pristine ecosystem for some part of their lives. Accordingly, Canada and the United States are party to agreements protecting ANWR's caribou herd and many of its migratory bird species as well.

U.S. Environmental Law Will Very Probably Still Apply to the Coastal Plain

It seems likely that even if Congress does authorize drilling, relevant environmental laws and agreements will still remain applicable to the ANWR area at issue: After all, giving companies not only access to drill, but an exemption environmental protections, would probably raise a ruckus even in this Congress.

And that ruckus would be entirely appropriate. There are substantial risks to the environment presented in the proposals to drill. Those risks will only sharpen in focus as the exploitation of the coastal plain proceeds.

What do we know, so far, about these risks? In 2002, a multi-agency task force released an updated report on the projected impacts to wildlife and the arctic environment from drilling on the coastal plain, which offers some valuable information.

It is impossible to isolate the precise impacts on the wildlife populations without first knowing where the oil or natural gas will be extracted. And there is always a chance of a catastrophic spill that would be devastating.

But a few givens are known. Oil drilling takes a lot of water - and that water demand will alter the region's environment. In addition, the infrastructure necessary for development--the roads and airstrips and platforms and pipelines - will fragment this still relatively undisturbed place, degrading it as a wildlife habitat, while possibly altering its surface water regime as well. Emitted pollution from both the drilling itself, and the related infrastructure will, in the subzero arctic environment, take longer to degrade and dissipate - raising the possibility of persistent (and perhaps highly concentrated) contamination.

It's no surprise, then, that - by comparison - a National Research Council report last year described the cumulative effects of North Slope and Prudhoe Bay oil and gas production as substantial and still mounting.

The Specific Laws That Will Apply: What They Will Require

The gamut mentioned above will include the Endangered Species Act (ESA) NEPA, the Clean Air and Clean Water Acts. ESA protects species listed by the government either as endangered or threatened," of which there are several on the coastal plain. There are different dimensions to the ESA, but its most relevant requirement here is that actions of the federal government only be taken in the presence of listed species where those agencies can be sure their actions will not further jeopardize the species. For drilling, depending on how and in what habitat areas, this is a potentially serious issue.

NEPA requires that all agencies of the federal government produce what is known as an environmental impact statement for any "major action" executed or funded by them which will "significantly affect[] the quality of the human environment." The Department of Interior is often wary of this obligation because it has a tendency to expand into an enormous analytical burden. And the duty may arise at several different junctures on the road to drilling in ANWR. This could also be a serious issue.

Furthermore, the operations' pollution control technologies will come under the strictest of scrutiny under the Clean Air and Clean Water Acts. Under the Clean Air Act, the "new sources" to be created in the drilling operations will all likely be subject to the most searching "best available technology" reviews by regulators. Under the Clean Water Act, the same may happen for any discharge of pollutants to waters or wetlands or dredging or, depending on how the operation is built, for any withdrawals of water from local surface water bodies.

Recall, too, that while the coastal plain does not itself enjoy the "wilderness" designation, it is surrounded by the designated "wilderness" of ANWR. In light of that fact, the government will have an obligation to tightly confine the effects of drilling. And if it fails to meet its obligation, private suits may be brought to force it to do so - as the U.S. Court of Appeals for the Ninth Circuit held in 1981 when it affirmed an Alaska district court's ruling in Trustees for Alaska v. Watt.

Finally, it's important to remember that the world will be watching as Americans extend yet one more frontier in their quest for fire. International agreements might come into play, and international organizations might try to intervene, if environmental abuses occur.

In sum, while environmentalists may be on the verge of losing a major battle over the coastal plain region of the ANWR, they haven't quite lost the war. It seems very likely that the region will face drilling, and that drilling will have a substantial, adverse environmental impact. But it also seems very likely that the impact of the drilling will provide the bases for a legal attack that could eventually limit or even halt it - or, at a minimum, lessen its impact on this as yet unspoiled American treasure.